THE CLOCK IS TICKING ON THE 27.5% OVDP OFFSHORE PENALTY (AS OPPOSED TO 50%) FOR THOSE WITH ACCOUNTS AT BANKS SOON TO BE ADDED TO THE IRS BAD BANKS LIST

The Department of Justice (DOJ) on May 29, 2015 announced that four more Swiss banks had entered into non-prosecution agreements (NPA), namely:

  • Societe Generale Private Banking (Lugano-Svizzera) SA (effective 5/28/15)
  • MediBank AG (effective 5/28/15)
  • LBBW (Schweiz) AG (effective 5/28/15)
  • Scobag Privatbank AG (effective 5/28/15)

As a consequence of this public disclosure by the DOJ, the IRS under FAQ 7.2 has added the above banks to its list of banks at which an account will subject all offshore assets connected with non-compliance to a 50% offshore penalty instead of the usual 27.5% penalty.

Below is a complete list of the banks currently on the list.

Foreign Financial Institutions or Facilitators

  1. UBS AG
  2. Credit Suisse AG, Credit Suisse Fides, and Clariden Leu Ltd.
  3. Wegelin & Co.
  4. Liechtensteinische Landesbank AG
  5. Zurcher Kantonalbank
  6. swisspartners Investment Network AG, swisspartners Wealth Management AG, swisspartners Insurance Company SPC Ltd., and swisspartners Versicherung AG
  7. CIBC FirstCaribbean International Bank Limited, its predecessors, subsidiaries, and affiliates
  8. Stanford International Bank, Ltd., Stanford Group Company, and Stanford Trust Company, Ltd.
  9. The Hong Kong and Shanghai Banking Corporation Limited in India (HSBC India)
  10. The Bank of N.T. Butterfield & Son Limited (also known as Butterfield Bank and Bank of Butterfield), its predecessors, subsidiaries, and affiliates
  11. Sovereign Management & Legal, Ltd., its predecessors, subsidiaries, and affiliates (effective 12/19/14)
  12. Bank Leumi le-Israel B.M., The Bank Leumi le-Israel Trust Company Ltd, Bank Leumi (Luxembourg) S.A., Leumi Private Bank S.A., and Bank Leumi USA (effective 12/22/14)
  13. BSI SA (effective 3/30/15)
  14. Vadian Bank AG (effective 5/8/15)
  15. Finter Bank Zurich AG (effective 5/15/15)
  16. Societe Generale Private Banking (Lugano-Svizzera) SA (effective 5/28/15)
  17. MediBank AG (effective 5/28/15)
  18. LBBW (Schweiz) AG (effective 5/28/15)
  19. Scobag Privatbank AG (effective 5/28/15)

With new banks coming into the NPA fold almost daily, the message is clear.  Continuing to wait to address an offshore bank account problem at best may subject a procrastinator to the higher penalty; and, at worst will expose him or her to criminal sanctions, should his or her name become known to the DOJ.

Don’t be left out in the cold.  Seek advice from an attorney experienced in these matters and explore the safest path for coming into compliance with the tax laws of the U.S.

Robert S. Steinberg, Esquire

www.steinbergtaxlaw.com

This entry was posted in 2014 OVDP, OFFSHORE BANK ACCOUNTS, OFFSHORE VOLUNTARY DISCLOSURE PROGRAM and tagged , , , , . Bookmark the permalink.

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